Natural gas prices edged lower on Friday, with the NYMEX Henry Hub contract settling at $3.198/mmBtu, down 1.08%. The market continues to trade in a tight $3.10-$3.25 range that has held for two consecutive weeks, with no single catalyst strong enough to break the pattern.
Working gas storage of 2,845 Bcf as of June 12 is 12% above the five-year average, according to the EIA Weekly Natural Gas Storage Report. The storage surplus has persisted through the spring injection season despite above-average power burn, as production levels have remained resilient.
The EIA reported a 67 Bcf injection for the week ending June 12, in line with the five-year average of 65 Bcf but below last year's 82 Bcf injection. The injection season is tracking at 80% of the five-year average rate, but the large starting surplus means storage will likely exit the injection season at comfortable levels.
Natural gas production has held steady at approximately 104 Bcf/d, down slightly from the 106 Bcf/d peak in late 2025 but still elevated relative to historical levels. The Permian Basin associated gas volumes continue to grow, adding supply pressure that offsets voluntary curtailments from EQT and Chesapeake.
For natural gas procurement, the persistent storage surplus means there's no urgency to lock in winter 2026-2027 baseload at current levels. The 12% storage surplus provides a comfortable cushion. If the market dips below $3.00 in the next injection report, that's a buying opportunity for Q1 2027 hedges. The current range is fair value.